China's Payment Revolution

Volume 2, 2016

As of last year, there were nearly 600 million smartphone users in China and together they racked up RMB100 billion in mobile Internet related business, 20% more than in 2014. These numbers make e-commerce and marketing experts like CEIBS Professor of Marketing Jeongwen Chiang, believe it’s highly likely that smartphones will become almost the only route for e-commerce in China within a few years.

There’s been no looking back since 2012, when 40% of the country’s one billion mobile subscribers opted for smartphones. Today, a multitude of apps, supported by convenient payment platforms and easily accessible mobile networks have made online shopping the norm; and shoppers in rural areas of the country have completely bypassed the PC and gone straight to mobile purchases.

This shift in consumer behaviour has transformed the way payments are made. By last year, China’s two major players in Internet payment, Alipay and WeChat, put their combined number of users at almost 500 million, and growing.

In this Cover Story, we look at the on-going transformation of China’s payment platforms, the disruptions to traditional forms of payment, and how these changes are affecting our everyday lives.